Retail businesses are prime candidates for MCAs due to their card processing volume.
Why Retail + MCA Works:
High Card Volume: Most retail transactions are card-based, making repayment seamless and qualification easier.
Seasonal Flexibility:
- ●Q4 holiday rush = higher payments (when you can afford it)
- ●January slump = lower payments (when you need breathing room)
Inventory Timing: Need to stock up before peak season? MCA provides quick capital to capture opportunity.
Common Retail MCA Uses:
- ●Seasonal inventory purchase
- ●Store renovation/refresh
- ●Point of sale upgrades
- ●Marketing/advertising
- ●Second location prep
- ●Emergency repairs
Retail-Specific Considerations:
Timing Your Application: Apply after strong months when bank statements look best. September is ideal for holiday inventory funding.
Inventory ROI: If your inventory turns at 50%+ margin, MCA cost can be justified. Calculate:
- ●Cost of MCA: $30K on $100K advance
- ●Inventory profit: $100K inventory at 50% margin = $50K profit
- ●Net benefit: $20K (worth it)
Typical Terms for Retail:
- ●Advance: $20K - $300K
- ●Factor: 1.20 - 1.40
- ●Holdback: 10-15%
- ●Term: 6-12 months
E-commerce Considerations: If primarily online, consider revenue-based financing instead—it's designed for e-commerce and may offer better terms.